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Costs of Maintaining Control System
Costs 2 Characteristics of Inventory Systems
May Be Known or Uncertain
May be Changing or Unchanging in Time
Lead Times - time that elapses from placement of order until
it’s arrival. Can assume known or unknown.
Review Time. Is system reviewed periodically or is system
state known at all times?
Treatment of Excess Demand. Backorder all Excess Demand
Lose all excess demand
Backorder some and lose some
Inventory that changes over time
obsolescence Relevant Costs
Holding Costs - Costs proportional to the quantity of
inventory held. In...
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This document was uploaded on 03/23/2014.
- Spring '14